Analyzing Key Tronic Corporation (KTCC) and Knowles Corporation (KN)

Key Tronic Corporation (NASDAQ: KTCC) and Knowles Corporation (NYSE:KN) are both small-cap computer and technology companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, profitability, analyst recommendations, valuation, earnings, risk and dividends.

Risk and Volatility

Key Tronic Corporation has a beta of -0.08, suggesting that its stock price is 108% less volatile than the S&P 500. Comparatively, Knowles Corporation has a beta of 0.76, suggesting that its stock price is 24% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and price targets for Key Tronic Corporation and Knowles Corporation, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Key Tronic Corporation 0 0 1 0 3.00
Knowles Corporation 0 1 2 0 2.67

Key Tronic Corporation currently has a consensus price target of $9.25, indicating a potential upside of 34.64%. Knowles Corporation has a consensus price target of $19.33, indicating a potential upside of 22.21%. Given Key Tronic Corporation’s stronger consensus rating and higher possible upside, analysts clearly believe Key Tronic Corporation is more favorable than Knowles Corporation.

Valuation & Earnings

This table compares Key Tronic Corporation and Knowles Corporation’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Key Tronic Corporation $467.80 million 0.16 $16.78 million $0.51 13.47
Knowles Corporation $867.60 million 1.63 $141.10 million ($0.23) -68.78

Knowles Corporation has higher revenue and earnings than Key Tronic Corporation. Knowles Corporation is trading at a lower price-to-earnings ratio than Key Tronic Corporation, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

41.6% of Key Tronic Corporation shares are owned by institutional investors. 7.2% of Key Tronic Corporation shares are owned by insiders. Comparatively, 2.2% of Knowles Corporation shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Key Tronic Corporation and Knowles Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Key Tronic Corporation 1.20% 5.08% 2.41%
Knowles Corporation -2.44% 6.98% 4.62%

Summary

Knowles Corporation beats Key Tronic Corporation on 8 of the 14 factors compared between the two stocks.

Key Tronic Corporation Company Profile

Key Tronic Corporation, doing business as KeyTronicEMS Co., is engaged in contract manufacturing for a range of products. The Company provides electronic manufacturing services (EMS) and solutions to original equipment manufacturers (OEMs) of a range of products. The Company provides engineering services, procurement and distribution, materials management, manufacturing and assembly services, in-house testing, and customer service. The Company provides EMS services, such as product design, surface mount technologies (SMT) and pin through hole capability for printed circuit board assembly (PCBA), tool making, precision plastic molding, sheet metal fabrication, liquid injection molding, complex assembly, automated tape winding, prototype design and full product assembly. The Company’s manufacturing operations are located in Oakdale, Minnesota; Fayetteville, Arkansas; Corinth, Mississippi; Harrodsburg, Kentucky, and foreign manufacturing operations in Juarez, Mexico, and Shanghai, China.

Knowles Corporation Company Profile

Knowles Corporation is a global supplier of micro-acoustic, audio processing and specialty component solutions, serving the mobile consumer electronics, communications, medical, military, aerospace and industrial markets. The Company operates through two segments: Mobile Consumer Electronics (MCE) and Specialty Components (SC). MCE designs and manufactures acoustic products, including microphones and audio processing technologies used in mobile handsets, wearables and other consumer electronic devices. SC specializes in the design and manufacture of specialized electronic components used in medical and life science applications, as well as solutions and components used in communications infrastructure and a range of other markets. It has sales, support and engineering facilities in North America, Europe and Asia, and manufacturing facilities in Asia. It also offers acoustics components used in hearing aids, as well as high-end oscillators (timing devices) and capacitors.

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